EU/non-EU Term changes and taxing (for sellers)
I am currently busy with tax returns for 2019 (first year with MT5 seller income). My tax consultant prompted that we need a clear statement with all tax office related info per calender year. The tables available on the profile and downloads are not cutting it, when it comes to providing clear proof of who is responsible of paying VAT.
NOW the even more concering part. I rechecked the fine print for developers and noticed that the terms have been overworked since last time I checked (last year) : https://www.mql5.com/en/market/terms/developer
V. Pricing and Payments
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This Agreement covers both Product Licenses You choose to distribute for free and Product Licenses for which You charge a fee. In order to charge a fee for Your Product Licenses, You must have a valid Payment Account under a separate agreement with a Payment Processor.
Product Licenses shall be offered to users at the prices, which You determine at your own discretion. If according to MetaQuotes Ltd, Product License sales are taxable, You authorize MetaQuotes Ltd to include the appropriate Tax amount into the payment charged from the buyer, in addition to the License price. Product Prices shall be expressed in US dollars. Market may display the prices of Products to Users in their native currency, but it shall not be responsible for the accuracy of currency rates or conversion.
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All financial transactions in Market shall be performed in accordance with the Market Payment System Regulations. The operational fee of the Market service is equal to 20%.
-
For Product Licenses sold in European Union member states, MetaQuotes Ltd determines whether the Product License is taxable (for example, subject to VAT). If the Product License is taxable, MetaQuotes Ltd or the Payment Processor shall collect the taxes arising from the sales of the License to users and shall pay them to the appropriate tax authority.
For Product Licenses sold in other countries and regions, You shall determine if the Product License is taxable as well as find out the applicable tax rate. Furthermore, You are responsible for remitting taxes to the appropriate taxing authority.
All Taxes shall be deducted from the selling price of the Product License. The remaining amount (the License sale price less the Market service operational fee of 20% and any applicable Taxes) shall be transferred to You.
Last year the EU/non-EU differentiation has not been stated (the terms lack a " terms valid since ... " phrase by the way) . Last year Metaquotes reassured me: " Yes, we pay VAT to appropirate governmental authority.", after asking : " is it correct that you pay the VAT to authorities as the reseller? ". This may or may not have something to do with the EU wide changes valid since 01.07.2021.
I know this is something that needs to be addressed to the Service Desk, but I think this needs more attention than I can provide with a simple service desk request by me.
Thanks for any help in advance.
(last years service desk image attached refers to https://www.mql5.com/en/forum/334315/page2)
Cheers, Julian
You are only responsible for your sales income minus the 20% MQL5.com commission.
You don't collect VAT (MQL5.com does), so you are not responsible for giving it to any local tax authority.
This is my personal opinion, but I think I am right about this.You are only responsible for your sales income minus the 20% MQL5.com commission.
You don't collect VAT (MQL5.com does), so you are not responsible for giving it to any local tax authority.
This is my personal opinion, but I think I am right about this.Thanks for the quick reply.
I do agree, and have treated it so far like this as well and will so in the future , but the somewhen overworked seller terms seems to state otherwise. (the part marked red). At least it is now clearly stated about the EU. But "
sold in other countries and regions" is new and may suggest otherwise obout non-EU. At least here in Germany my tax advisor is less than happy about the financial statements provided to me/us by Metaquotes (the tables and statistics avaiable on the seller profile).
Besides the possible change in seller terms, I personally was/are in peace with it because Metaquotes assured me that they take care of VAT (when I asked them last year). But at least in Germany (and propably EU) ,tax offices expect VAT, otherwise they need either
invoices involving a reverse charge clause (which is not the case here, because metaquotes is the seller and charges VAT), or yearly account statements stating otherwise.
I think highly positive about the noticable increase of quality, speed and attentivness of the service desk over the last year; But tax office compliant statements for each calendar year is going to be needed to cut more red tape in the future.
That is correct. Here in Portugal when declaring such sales and VAT reports, one declares those sales in a separate section, specific for sales where the VAT has already been liquidated by a third party.
Thanks
I do agree, and have treated it so far like this as well and will so in the future , but the somewhen overworked seller terms seems to state otherwise. (the part marked red). At least it is now clearly stated about the EU. But "
sold in other countries and regions" is new and may suggest otherwise obout non-EU. At least here in Germany my tax advisor is less than happy about the financial statements provided to me/us by Metaquotes (the tables and statistics avaiable on the seller profile).
Besides the possible change in seller terms, I personally was/are in peace with it because Metaquotes assured me that they take care of VAT (when I asked them last year). But at least in Germany (and propably EU) ,tax offices expect VAT, otherwise they need either
invoices involving a reverse charge clause (which is not the case here, because metaquotes is the seller and charges VAT), or yearly account statements stating otherwise.
I think highly positive about the noticable increase of quality, speed and attentivness of the service desk over the last year; But tax office compliant statements for each calendar year is going to be needed to cut more red tape in the future.
Think of it this way (and it should help out with your account, or tax advisor, too). You are not selling to the end customer. You are selling to MetaQuotes which is a EU company, and they are the ones that are reselling it to the end customer.
So, it does not matter where it is being sold, or to whom. That is not your concern. You are ONLY selling your products to a single EU based company called MetaQuotes and nothing else matters.
The only difference is that they are not paying you up front, but instead they are paying you on consignment.
- David Noah
- www.shippingsolutions.com
Think of it this way (and it should help out with your account, or tax advisor, too). You are not selling to the end customer. You are selling to MetaQuotes which is a EU company, and they are the ones that are reselling it to the end customer.
So, it does not matter where it is being sold, or to whom. That is not your concern. You are ONLY selling your products to a single EU based company called MetaQuotes and nothing else matters.
The only difference is that they are not paying you up front, but instead they are paying you on consignment.
Metaquotes answered as well. No changes, all VAT are collected (both EU/non-EU). I still think that the terms (red marked texted above) are missleading in this case, but all good now from my site. Thanks everyone, and I guess this thread will be useful for newbies as well:
Support Team 2021.07.27 13:26Dear User,
The replies you got in the forum are correct.
MetaQuotes collects the relevant applicable charges (meaning VAT) as these are defined by the supporting applicable legal framework.
Currently there is no capability (nor a need) for tax statements generation, since MetaQuotes is resposible for the collection and payments of VAT and not the individual user.
Thank you.
Hi, thanks for the quick response. Can you please state if this is true for EU only or non-EU as well?Support Team 2021.07.27 13:30jaegerjj
Hi, thanks for the quick response. Can you please state if this is true for EU only or non-EU as well?This is true for every jurisdiction (meaning EU and non-EU) and all the relevant (and required) legislation is applied.
Metaquotes answered as well. No changes, all VAT are collected (both EU/non-EU). I still think that the terms (red marked texted above) are missleading in this case, but all good now from my site. Thanks everyone, and I guess this thread will be useful for newbies as well:
Support Team 2021.07.27 13:26Dear User,
The replies you got in the forum are correct.
MetaQuotes collects the relevant applicable charges (meaning VAT) as these are defined by the supporting applicable legal framework.
Currently there is no capability (nor a need) for tax statements generation, since MetaQuotes is resposible for the collection and payments of VAT and not the individual user.
Thank you.
Hi, thanks for the quick response. Can you please state if this is true for EU only or non-EU as well?Support Team 2021.07.27 13:30jaegerjj
Hi, thanks for the quick response. Can you please state if this is true for EU only or non-EU as well?This is true for every jurisdiction (meaning EU and non-EU) and all the relevant (and required) legislation is applied.
You should declare your "income", which is the final value you received (or would receive) once you have gone through all the payment processing, and it finally reaches you bank account.
So, if part of that income was used to buy other products, then that would still be part of your income. However, depending on how you are fiscally classified (as an individual, or as a company or as some business entity), then that value could be reclassified, as an expense, or as assets or as an investment—it really depends on how your accountant wishes to classify such purchases.
It is best to speak to an accountant as they will be more knowledgeable about these things, specifically for your country and your individual case.
Here in Portugal, if your earnings for these kind of things (surplus earnings) is less the a certain yearly value (depends on your age), then there is no need to declare it, and if you reinvest part of it, then the reinvested part is not taxable.
So, speak to your accountant or bookkeeper for more details and exact instructions for your specific case.
Hello everyone, I am not sure if this is the right thread to ask this question, so I apologise in case it's not.
You can also look into Estonias e-Citizenship if you are European , if its still available , and if nothing happens to Estonia.
.
(also on the original topic ,theres Moss since 2015 for digital products in the EU)
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I am currently busy with tax returns for 2019 (first year with MT5 seller income). My tax consultant prompted that we need a clear statement with all tax office related info per calender year. The tables available on the profile and downloads are not cutting it, when it comes to providing clear proof of who is responsible of paying VAT.
NOW the even more concering part. I rechecked the fine print for developers and noticed that the terms have been overworked since last time I checked (last year) : https://www.mql5.com/en/market/terms/developer
V. Pricing and Payments
This Agreement covers both Product Licenses You choose to distribute for free and Product Licenses for which You charge a fee. In order to charge a fee for Your Product Licenses, You must have a valid Payment Account under a separate agreement with a Payment Processor.
Product Licenses shall be offered to users at the prices, which You determine at your own discretion. If according to MetaQuotes Ltd, Product License sales are taxable, You authorize MetaQuotes Ltd to include the appropriate Tax amount into the payment charged from the buyer, in addition to the License price. Product Prices shall be expressed in US dollars. Market may display the prices of Products to Users in their native currency, but it shall not be responsible for the accuracy of currency rates or conversion.
All financial transactions in Market shall be performed in accordance with the Market Payment System Regulations. The operational fee of the Market service is equal to 20%.
For Product Licenses sold in European Union member states, MetaQuotes Ltd determines whether the Product License is taxable (for example, subject to VAT). If the Product License is taxable, MetaQuotes Ltd or the Payment Processor shall collect the taxes arising from the sales of the License to users and shall pay them to the appropriate tax authority.
For Product Licenses sold in other countries and regions, You shall determine if the Product License is taxable as well as find out the applicable tax rate. Furthermore, You are responsible for remitting taxes to the appropriate taxing authority.
All Taxes shall be deducted from the selling price of the Product License. The remaining amount (the License sale price less the Market service operational fee of 20% and any applicable Taxes) shall be transferred to You.
Last year the EU/non-EU differentiation has not been stated (the terms lack a " terms valid since ... " phrase by the way) . Last year Metaquotes reassured me: " Yes, we pay VAT to appropirate governmental authority.", after asking : " is it correct that you pay the VAT to authorities as the reseller? ". This may or may not have something to do with the EU wide changes valid since 01.07.2021.
I know this is something that needs to be addressed to the Service Desk, but I think this needs more attention than I can provide with a simple service desk request by me.
Thanks for any help in advance.
(last years service desk image attached refers to https://www.mql5.com/en/forum/334315/page2)
Cheers, Julian